Net profit for Milkiland decreased 6.4% in the first half of 2012
2012-08-27 15:16:12
According to the official report released by the company, Milkiland reached EUR 6.258 M figure during the period of January-June of 2012, 6.4% down from EUR 5.858 M during the same period of 2011. Consolidate sales revenues grew 5.2% to EUR 143.1 M as EBITDA decreased 13.3% to EUR 16.215 M. Operational profit decreased 12.4% to EUR 9.559 M. Company’s operations were positively affected by subsidization policy of diary farms in Ukraine. Ergo company’s EBITDA grew by 4% in the second quarter to EUR 9.6 M. Major reason for a decrease of net profit was a threefold increase in profit taxes. Pretax profit grew 4.6% to EUR 7.344 M due to increase in financial revenues.
Company’s report stated: “The export ban imposed by Russian Federal Service on Customer's Rights Protection and Human Well-Being Surveillance (Rospotrebnadzor) for seven Ukrainian cheese exporters, including Milkiland's Mena cheese plant, partially limited the ability of Milkiland to sell cheese in Russia On the positive side, Rospotrbnadzor's restrictions triggered a 31% drop in raw milk prices in Ukraine from the beginning of 2012, ending up on average 3-10% lower year-on-year."
The company also stated that the cheese ban caused a decrease in the share for cheese and butter in total revenue from 53% in the first half of 2011 to 51% while whole-milk products' share increased from 39% to 41% (in absolute terms, sales growth for these product groups came to 1% 12% respectively).
AgroInvest comment: high pressure from government regulations in terms of taxes and import limitations led to poor financial results during the first quarter of 2012.
For more detail please refer to the UAIndex Daily (August 27 issue).
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